Compilation of the Social Security Laws

RECOMMENDATIONS BY BOARD OF TRUSTEES TO REMEDY INADEQUATE
BALANCES IN THE SOCIAL SECURITY TRUST FUNDS

Sec. 709. [42 U.S.C. 910](a) If the Board of Trustees
of the Federal Old-Age and Survivors Insurance Trust Fund and the
Federal Disability Insurance Trust Fund, the Federal Hospital Insurance
Trust Fund, or the Federal Supplementary Medical Insurance Trust Fund
determines at any time that the balance ratio of any such Trust Fund
for any calendar year may become less than 20 percent, the Board shall
promptly submit to each House of the Congress a report setting forth
its recommendations for statutory adjustments affecting the receipts
and disbursements of such Trust Fund necessary to maintain the balance
ratio of such Trust Fund at not less than 20 percent, with due regard
to the economic conditions which created such inadequacy in the balance
ratio and the amount of time necessary to alleviate such inadequacy
in a prudent manner. The report shall set forth specifically the extent
to which benefits would have to be reduced, taxes under section 1401,
3101, or 3111 of the Internal Revenue Code of 1954[16] would have to be increased, or a combination thereof,
in order to obtain the objectives referred to in the preceding sentence.

(b) For purposes of this
section, the term “balance ratio” means, with respect
to any calendar year in connection with any Trust Fund referred to
in subsection (a), the ratio of—

(1) the balance in such
Trust Fund as of the beginning of such year, including the taxes transferred
under section 201(a) on the first day of such year and reduced by the outstanding amount
of any loan (including interest thereon) theretofore made to such
Trust Fund under section 201(l) or 1817(j), to

(2) the total amount
which (for amounts which will be paid from the Federal Old-Age and
Survivors Insurance Trust Fund and the Federal Disability Insurance
Trust Fund, as estimated by the Commissioner, and for amounts which
will be paid from the Federal Hospital Insurance Trust and the Federal
Supplementary Medical Insurance Trust Fund, as estimated by the Secretary)
will be paid from such Trust Fund during such calendar year for all
purposes authorized by section 201, 1817, or 1841 (as applicable), other
than payments of interest on, or repayments of, loans under section 201(l) or 1817(j), but excluding any transfer
payments between such Trust Fund and any other Trust Fund referred
to in subsection (a) and reducing the amount of any transfers to the
Railroad Retirement Account by the amount of any transfers into such
Trust Fund from that Account.

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